China, Spies, and Other Dragons
The ongoing Chinese spy scandal is reminiscent of a 50-year old case that rocked the Truman administration. In January 1945, an Office of Strategic Services (OSS) officer was surprised to read the verbatim contents of his recent Top Secret report on Asian resistance movements in Amerasia, a left-wing U.S.-published magazine. After breaking into the magazine's offices, the Federal Bureau of investigation (FBI) found numerous other classified documents, as well as a well-equipped photo studio and darkroom, and other espionage equipment. Wire taps made it clear that many staff members were Soviet intelligence agents. Eventually the FBI obtained indictments, but the case stalled because the break-ins and the wiretaps had been illegal. Federal prosecutors hoped that at least some of those indicted would admit their espionage, thus making their case. As it happened, none did. The case had to be abandoned because, whatever the prosecutors knew, they could not prove anything in court.
By this time, however, the United States was engaged in the Cold War against the Soviets. Indeed, Amerasia was the first post-World War II Soviet espionage case to reach the courts. It began just as more or less sensational charges of Truman administration complicity in Soviet advances were surfacing. Many Americans were sure that there was some substance in the charges against Amerasia, and they could not understand why the prosecution was stalling. It was easy to imagine that the administration feared exposure of its own softness toward the Soviets. The reality was that nothing could be done because the evidence the FBI had collected was inadmissable in court.
Much the same problem applied to evidence of Soviet espionage that was being developed at about the same time by the Venona code-breaking project. In some cases senior members of the administration, even President Harry Truman himself, were not told of information developed by code-breaking. Consequences of this decision, which was taken to protect the security of the project, included long-standing doubts about the guilt of prominent officials, such as Alger Hiss and Harry Dexter White. Officials like Secretary of State Dean Acheson could not believe allegations against former colleagues, and they did not know that Soviet messages already had proved that these apparently honorable men actually were Soviet agents.
The larger consequences, for the United States, were quite serious. The guilt or innocence of men like Hiss became partisan issues rather than simple matters of provable fact (Richard Nixon began his rise by prosecuting Hiss). The Republicans, out of power for more than a decade, saw proof of treason in the administration's apparent unwillingness to pursue Soviet spies. When the U.S.-backed Nationalist regime in China collapsed, the cry was that the administration had "lost" China because it had not really wanted to win; too many of its officials were "pink."
The Republicans won their fight; Truman's Democrats were never able to prove that they had been hamstrung by either constitutional limits on the courts or, in the case of Venona, by security considerations. In the early 1960s both Democratic Presidents, John F. Kennedy and Lyndon B. Johnson, remembered the Republican charges and feared the consequences of "losing" Vietnam.
At the same time, many Americans eventually found the Republican charges so extreme as to seem baseless. The Republicans helped by embellishing their cases to the point of absurdity; apparently they could not readily distinguish the reality, that there were highly placed Soviet spies, from fantasies about large numbers of traitors within the Truman administration. With little realistic information available, it was far too easy to identify anyone on the political left with communists and ultimately with the Soviets. Anticommunism came to seem to be a kind of extremism, and it was largely discarded. Now that the Cold War is over, and that Venona has been declassified, we can see that many of those the Republicans branded as spies in the late 1940s really were working for the Soviets. Had the truth come out in time, perhaps the gross excesses of McCarthyism could have been avoided. Perhaps anticommunists would not have seemed quite so absurd to so many. The country might have found itself far more united when it faced a communist challenge in Vietnam. It also might have been less surprised by the brutal consequences of the communist victories in that unhappy country—and, for that matter, by the behavior of the current Chinese government.
Now move ahead to the current spy scandal. There is little question that the investigation at Los Alamos was badly bungled. The Justice Department, for example, was unwilling to examine the computer of the chief suspect, even though it now turns out that earlier he had signed a waiver explicitly permitting just such a search. It also seems that the investigation was focused on just the one physicist, to the point of not even considering alternatives who were not ethnically Chinese. It would be easy to connect such failures with the administration's pursuit of Chinese money for its 1996 campaign, and, for that matter, with its close relationship with major U.S. corporations intent on furthering their commercial relationships with the Chinese communist regime. Exactly such charges are likely to echo through the next presidential election. Did the Chinese simply buy the Clinton administration?
Recall Amerasia. The current charge is that the Chinese obtained the design of an advanced U.S. warhead, the W-88 carried on board Trident missiles. That is not merely an inference from the seismic signature of a Chinese nuclear test; it is said to be the content of a highly secret Chinese document, or perhaps even the content of a Chinese conversation. In either case, the information certainly was obtained in a very secret manner. If it was in a document, then any very detailed description of the document, which would have to come out in an espionage trial, would allow the Chinese to infer just how it was obtained. At the least, it would compromise a valuable agent, or even a group of agents. If a conversation was involved, then the mechanism by which it was intercepted is probably still in place. Losing that mechanism would be far more damaging to the United States than any continued Chinese espionage operation, since the intercept mechanism gives the U.S. government a window into some very high levels of the Chinese state.
Without being able to say what information the Chinese got, or how important it was, which would depend on Chinese statements obtained by the U.S. government, no espionage case probably could be prosecuted.
The Chinese themselves have gone to some effort to claim that they developed all of their crucial technology without foreign help, i.e., without any espionage. Anyone who looks at modern Chinese weapons, however, can see their foreign ancestry; very clearly China, like any other developing country, depends on foreign inputs. Otherwise it could not develop nearly quickly enough, since it lacks sufficient hard currency to buy everything it (or its military) needs. The Chinese denials are really beside the point. Some of them are so absurd that they recall Cold War Soviet propaganda at its worst. One Chinese newspaper, for example, reported that the United States had offered $10 million for an unexploded missile found in the ruins of the Chinese embassy in Belgrade, but that instead this precious item had been sent back to China for analysis, which revealed that Chinese weapons were more accurate. The reality is that the embassy was hit by inexpensive Global Positioning System (GPS)-guided bombs, which carry few if any secrets and are hardly the most precise weapons in our arsenal.
In another case, misinterpreting the charge, a Chinese weapons expert claimed that China was ahead of the United States in nose-cone (presumably re-entry vehicle) technology (the point was not the nose cone, but what was inside). In yet another case, a Chinese newspaper claimed that China had supplied the technology for the French Exocet antiship missile. But the Chinese C-801 is a somewhat inferior copy of the Exocet, adopted after the failure of the indigenous FL-7 program.
Some of this is undoubtedly nationalist bluster. But the bluster was not there a few years ago; it is something new. That it appears in nominally independent newspapers suggests that the Chinese press is much more controlled than we may imagine. It is supporting a government line that access to standard reference material easily should have deflated.
It cannot be much of a surprise that China engages in espionage against the United States. We are the natural target, because we have the most advanced military technology. The first question is whether Americans helped, and the second, more explosive question is whether the Clinton administration deliberately turned a blind eye because it was more interested in campaign money than in national security. The sad part is that, as in the Amerasia case half a century ago, the Chinese espionage case probably cannot be pursued because some of the evidence literally cannot be used in an open court. The consequence is likely to affect the outcome of the 2000 election, just as the outcome of cases like Amerasia affected the 1950 election. As in 1950, the effect is likely to be exacerbated by drastically deteriorating relations between this country and China.
There seems little question, now, that the Chinese government has decided that good relations with the United States are not terribly important, and that it is far more vital to cement its own power. The government has decided, for example, to suppress all potential opposition movements, no matter how trivial. When a large sect, Falun Gong, an offshoot of Buddhism, demonstrated its power by assembling 10,000 followers for a silent vigil near the homes of the Chinese leaders in Beijing, the government banned it. What they apparently found frightening was that there had been no warning of the demonstration. Now Protestant churches also have been banned; they, too, offer Chinese citizens some outlet other than the Communist Party. Neither development is likely to appeal to Americans, who may imagine that good relations with China will help lead that country into a democratic future.
For the party, it may seem that encouraging bad relations with the United States is a way of discouraging the poison it associates with this country: democracy. Many Americans have suggested that, whatever the party may imagine, by allowing free enterprise it is precluding any return to a Mao-style dictatorship. They may be right—and the party may well decide that its best path to survival is to eliminate free enterprise altogether. Many Chinese may object; but the party showed that it did not care very much about public opinion when it banned a harmless but popular sect with up to 100 million members.
Such a decision, of course, would be very embarrassing for the Western firms that supported the "constructive engagement" pursued by the Clinton administration. Next year, will the charge be that an administration has "lost" China—again?
Iridium Goes Belly-Up
In August, the Iridium consortium declared bankruptcy. Iridium was a 66-satellite constellation of low-orbiting satellites intended to provide telephone service between any two places on earth (with the notable exception of the world's oceans). Unlike other satellite systems, it required no more than a handset, because its satellites were much closer to the user. (Inmarsat, the International Maritime Satellite, which provides satellite telephone service at sea, uses satellites in much-higher geosynchronous orbits.)
Because the Iridium satellites are at low altitude, the system must switch automatically from satellite to satellite as each vanishes beyond the user's horizon. This requires sophistication at both ends of the system: the satellite and the ground terminal. As in terrestrial systems, users are billed according to the distance a call covers. Because it handles mobile telephones, then, Iridium must calculate the user's position on the earth, which it does by means of the satellite's motion. As in the existing Navy Transit navigational system, the user's location affects the Doppler shift of his signals at the moving satellite. Thus Iridium is not only a communications system, but also a kind of inverse navigational system. It is a technological marvel.
The collapse of the consortium might seem no more than a reflection of the usual hazards of business, but Iridium had an important defense role. The Department of Defense had bought capacity before Iridium went on line, and had built a special "gateway" in Hawaii. Each commander-in-chief received a supply of Iridium telephones and funding for Iridium calls. The gateway stripped away from each signal the geolocation data the system used for billing, itself calculating the charges to be assessed for each call, to conceal the locations of the U.S. callers.
Iridium crashed because its real competitor, earth-based cell phone technology, grew much faster than expected. The Iridium business plan had envisaged 100,000 subscribers by April 1999. In fact there were only 10,000. Overall, it seems that space-based communications systems are unlikely to gain anything like the projected market of 30 to 40 million users. For Iridium or an equivalent, the military is a very special user. It really does need a system that can function despite the absence of any terrestrial net—or, indeed, when the only available net is hostile.
Iridium probably will be sold off for a fraction of what it cost to construct. Even so, the new owners may well find it impossible to maintain. Moreover, the 66 satellites (the system needs all of them to function) will have to be replaced within a few years. It is entirely possible that in order to maintain this sort of service the U.S. government will find it necessary to buy and then to maintain the Iridium system. It simply cannot turn its gateway and its handsets over to some other alternative system, which will use a different technology, and whose investors may in any case be frightened off by the Iridium debacle. It will have to decide whether to spend far more than it originally had envisaged to buy one of several possible satellite systems, or even to abandon the sort of service Iridium had promised. Quite likely other communication satellite projects will suffer.
That experience may carry a larger lesson. Satellites already are an essential ingredient in U.S. military and naval operations. The question is how to provide ever-increasing capacity without spending too much. One way out, as in many military projects, is to piggyback on existing commercial technology and systems, to allow investors to take the risk and then buy the service they offer. The U.S. government already leases some major commercial satellite systems, such as those used for the Challenge Athena broadband naval service. The very important Information Technology (IT)-21 naval computer communications net uses leased Inmarsat satellite transponders.
The general assumption is that the communications industry is growing very rapidly, and that all such commercial services will prosper. The Iridium debacle suggests otherwise, even though the stock market considered Iridium a sure thing.